Bill Rolls Back Intangibles Tax

Democrats Fail To Curb Breaks For Wealthy

April 1, 2005|By Mark Hollis Tallahassee Bureau

TALLAHASSEE — Troubled by the Legislature's zeal for helping the wealthy by repealing the intangibles tax on stocks and bonds, several South Florida Democrats on Thursday tried to convert the tax break to a windfall for the working class.

A proposal by Rep. Tim Ryan, D-Dania, would impose a more modest cut to the intangibles tax. An amendment by Rep. Ken Gottlieb, D-Hollywood, would provide modest savings to a broader array of Floridians by reducing property taxes.

But rather than going along with those plans, the Republican-run House tentatively approved a major tax bill (CS-HB963) that rolls back the intangibles tax at a financial hit to the state of $236 million this year and $301 million next year.

Democrats decried the decision as another sharp jab to the poor and middle class who don't typically have the financial investments that require any intangibles tax payments.

"We all dislike taxes," said Rep. Dan Gelber, D-Miami Beach. "But you all [Republicans] are saying that you're for lowering taxes, just not for lowering taxes for anyone I know."

Republicans, who since 1998 have been trying to gradually scale back the numbers of people required to pay the intangibles tax, hailed their bill as a step toward meeting Gov. Jeb Bush's pledge of repealing the tax completely before he leaves office.

"It's been a long struggle to get to this point to get rid of this horrible tax," said Rep. Jeffrey Kottkamp, R-Cape Coral. "It's time to stop taxing the life savings of our senior citizens."

The tax is currently imposed on stocks and bonds at a rate of $1 per $1,000 of taxable assets. The first $250,000 of investments is exempt.

The House defeated plans by Democratic legislators from Broward County that would have slowed down the pace of the tax cutting.

By a 55-vote margin, the House killed Ryan's amendment to keep the intangibles tax but raise the amount that would be exempted from $250,000 to $1 million for individuals and up to $2 million for married couples.

The loss of revenues to the state under Ryan's amendment would have been $128 million, less than half the financial impact than the Republican bill.

"Responsible tax relief is an important job for us," Ryan said. "But we can't be blind to the priorities of this state regarding schools, Medicaid and other qualify of life issues that our constituents demand we address."

Gottlieb attempted to restore the intangibles tax to the level it was in 1998 and use that $1.2 billion in available revenue to trim property taxes owed by homeowners and businesses.

His plan would have given most homeowners a $100 property tax break on every $100,000 of assessed valuation. Under that plan, the owner of a home valued at $250,000 would get a $250 tax break.

"The Republicans have their rhetoric that says `Let's lower taxes,'" Gottlieb said. "But they haven't looked at how they have actually raised property taxes."

According to Gottlieb, the state-imposed share of property taxes collected in Florida has increased by $7.2 billion since 1999.

Mark Hollis can be reached at mhollis@sun-sentinel.com or 850-224-6214.